The United Kingdom’s Financial Conduct Authority (FCA) has set out a new framework for the regulation of the cryptocurrency industry.
The British regulator is seeking feedback on its discussion paper, with various measures on the table, including banning public crypto offers.
Although the regulatory body has proposed the ban on open public offerings, there will be provisions for exceptions in limited instances.
As part of the new approach, the FCA wants to introduce a more rigid structure and to improve clarity as part of aspirations to provide “clear and consistent ‘rules of the game’ for firms and consumers.”
This fresh proposal for the future of crypto in the UK builds on the existing rules that prevent unregistered companies from targeting UK users, while there is a desire to eradicate abuse of the current rules and an overall lack of transparency.
The latter is a common theme across international markets with United States President-elect Donald Trump determined to assert his plans to make the U.S. the “world capital for crypto”.
Clear admissions, disclosures and market abuse rules will help improve the integrity of our crypto markets, while protecting people and supporting the UK's growth and competitiveness.
Find out more https://t.co/zB3e0xXkti#crypto #CryptoRegulation #FinancialRegulation
— Financial Conduct Authority (@TheFCA) December 16, 2024
You should be prepared to lose everything: FCA
“Admissions and disclosures and market abuse regimes are crucial to improving the integrity and cleanliness of our crypto markets, as well as helping people make informed financial decisions,” said the FCA on Monday (Dec 16).
It also set out the goal to put down foundations, to develop a model framework fir for the long term which would encourage sustainable investment. The discussion paper has been published following various roundtable summits earlier this year, involving government representatives and industry stakeholders.
The positive approach has been tempered with the FCA warning crypto assets remain largely high-risk and unregulated, and if something goes wrong, you should be prepared to lose everything and not be protected.
Since 2020, the FCA has been the UK’s watchdog on crypto, enforcing compliance under AML rules, with strict codes to be met if companies are to legally operate in the UK.
Industry figures and delegates are expected to respond to the paper as intended, with the draft regulations to be published next year, followed by a finalized framework in 2026.
Image credit: Via Midjourney
